First of all—congratulations!
If you are reading this post, that means you are at least thinking about expanding your practice and forming a group, which hopefully means you have a successful group practice or maybe just big dreams!
For the sake of this blog post, I am going to assume that you are in a solo practice with a sole proprietor EIN and have individual contracts with insurance companies.
Here are the steps you should take when expanding from a solo practice to a group practice:
1. Prep work
- Decide what type of business entity you want to form
- LLC/PLLC, S-Corp etc.
- This might include speaking with a lawyer or accountant on which business structure works best for you
- Obtain an NPI 2
- Can get one here (the same as your NPI 1).
- This will be the NPI for your group/organization and is needed for billing.
- Get a new business bank account for your new group practice/entity
- Add your new group practice as a new practice location on CAQH and re-attest
2. Contact insurance companies:
- This will most likely be your network representative or provider relations
- Express that you are expanding to a group practice and would like a group contract.
- Give them your sole prop EIN
- Some insurance companies do not allow for group contracts unless you have a certain number of clinicians. In that case, you will just be changing your tax ID to your new LLC/S-Corp
3. You will get sent group contracts and most likely group rosters.
- List yourself as a clinician on the group rosters
- Use your organizational NPI and your new group EIN
- If you already have clinicians you are ready to credential, you would also add them to your roster.
4. While waiting for your new group contracts to be executed, you can still bill under your sole prop EIN as usual.
5. Once the contracts are executed, be mindful of the effective date.
- Any date of service, on the effective date or after can be submitted under the new group EIN.
6. Sign up for electronic funds deposit/EFT using your new group practice bank account.
7. Billing as a group practice:
- Essentially the same, except in Box 32a and 33a you are putting your NPI 2
- In Box 33 you are checking ‘organization’ putting your group practice information.
- You are also using your NEW group practice EIN in box 25
Employee’s NPI 1 in Box 24J
Type 2 NPI in Box 32a and 33a and Group Billing/EIN. Group name/billing address in box 33 and check Organization.
If the insurance company does not allow group contracts, you may have to continue to bill under your NPI 1 but with your group practice EIN.
Stay tuned for my next blog post about adding clinicians to your group practice contracts.
Hi! If I am a Phd running a group practice and doing all Intakes and supervising all cases and then handing off to my
Therapists to offer the ongoing therapy, can they bill at my PHD rate if they are Lcpc’s or LCSW’s, billing under my NPI 2.
LCPCs and LCSWs are to be credentialed under your group contracted rate and bill as the rendering provider under the claim. Depending on the contracted rate, they might get the higher doctoral rate, but most payers pay MA level clinicians less regardless of the contracted rate. You can bill the doctoral rate on the claim, the claim might not get paid at the doctoral rate and if it does it might get recoup’d later on when insurance companies do their audits and realized they have overpaid your practice due to paying at the doctoral rate when the rendering provider is actually a MA level clinician. Hopefully this makes sense! I would watch the EOBs very carefully.
Great resource. If i dont yet have an llc but have therapists i am trying to panel, and bill as sole proprietor with my npi 1number does this create problems in getting my team paneped and or for billing please. Thank u in advance. All my best. Tyler
Yes, that would create a problem as you cannot panel clinicians under a sole proprietor EIN. You’ll need an LLC, PLLC, PC, S-Corp, etc.
How do we add a new licensed mental health provider to our group thru medicaid?
That varies by state. I would contact your local Medicaid for the process.
Can a PLLC employ and bill for an LMSW?
That depends on your state licensure laws and insurance panels. Is an LMSW a provisionally licsened social worker in your state?
Hello, I was trying to click on the next post about adding clinicians to your group (paneling) and I could not click on the link. Would you happen to still have that post active? Thank you!
I haven’t written it yet! haha! It varies based o insurance though!
Thanks for the post! It was very helpful.
My wife has been operating a solo practice in PA for the last few years. I do all the billing for her. She currently has an EIN setup and both a type I and type II NPI. All the billing with the insurance companies is currently done with her type I NPI (rendering provider, box 32, and box 33) and EIN (box 25). We have been talking about expanding into a group practice for a while now, but I think the current setup with the insurance companies (Type I NPI in box 32 and 33) might cause issues when we hire additional providers. I want to be sure that payments get made to the group and not to individual providers. I’ve asked the insurance companies if my wife was setup to bill with her type II NPI in box 32 and 33 and they said no at this point. The few provider relations people I talked to at the insurance companies didn’t seem to have an answer as to what we need to do. Should this be a simple process where we just need to notify the insurance companies of the Type II NPI or could this be more challenging where we need new contracts with the Type II NPI?
Yes, it’s more challenging as you will need to execute new contracts under the new entity when possible. She is contracted individually now and will need to be contracted as a group in order for the group to get paid. If you’d like to purchase an hour consultation we can talk more about this.
Dave,
Where did you learn to do billing for your wife? Which EMR does she use? We are thinking ( I am not a therapist, my husband is) of doing it ourselves because we are disappointed with the billing company we are working with. We have a contract with insurances ( that allow group practice) as a group practice. Looking forward to hearing from you.
Thank you in advance!
Hi Mila, my name is Danielle and I am a clinician and do my own billing for my group practice. I use Simple Practice as my EHR for my group practice. I offer consultations to clinicians so they can do their own credentialing and billing. I am not a biller and do not offer billing services to other practices. Hope this clears things up.
Danielle,
Wow! Thank you for this info. I think I am confused… I am paneled with a group. I plan to slowly start up my own practice, apply for npi 2 and then to apply for credentialing for this npi2. Will I be able to move any of my panels from the group I am in to the npi2 that I get for my own or do I have to start back over? I am looking for the most efficient way to get an npi 2 to start group and get it credentialed.
Thank you for your guidance!
Paneling is not by NPI, it’s by tax ID/EIN. If you are planning to switch from a group practice and start your own group, I would go that route with getting group contracts executed when possible. I speak more in-depth about this in my webinar. This blog post is for people already established in solo practices looking to expand, not people going from a group practice to starting their own group. Hopefully, that makes sense.